Discuss the information required for aggregate planning.

An aggregate planner requires the following information:
Demand forecast F t for each Period t in the planning horizon that extends over T periods
Production costs
Labor costs,regular time ($/hour),and overtime costs ($/hour)
Cost of subcontracting production ($/unit or $/hour)
Cost of changing capacity;specifically,cost of hiring/laying off workforce ($/worker)and cost of adding or reducing machine capacity ($/machine)
Labor/machine hours required per unit
Inventory holding cost ($/unit/period)
Stockout or backlog cost ($/unit/period)
Constraints:
Limits on overtime
Limits on layoffs
Limits on capital available
Limits on stockouts and backlogs
Constraints from suppliers to the enterprise
This information is used to create an aggregate plan that in turn helps a company make the following determinations:
Production quantity from regular time,overtime,and subcontracted time: used to determine number of workers and supplier purchase levels.
Inventory held: used to determine how much warehouse space and working capital is needed.
Backlog/stockout quantity: used to determine what the customer service levels will be.
Workforce hired/laid off: used to determine any labor issues that will be encountered.
Machine capacity increase/decrease: used to determine if new production equipment needs to be purchased or idled.
The quality of an aggregate plan has a significant impact on the profitability of a firm.A poor aggregate plan can result in lost sales and lost profits if the available inventory and capacity are unable to meet demand.A poor aggregate plan may also result in a large amount of excess inventory and capacity,thereby raising costs.Therefore,aggregate planning is a very important tool in helping a supply chain maximize profitability.